The Memphis appeal. [volume] (Memphis, Tenn.) 1886-1890, 1887-05-10
GOOD THING FOB OFFICERS
BUT A POOR ONB FOR THE
STOt KHOLDERS.
How the Southern Cotton OIL Com
pany Was Organized - Where
Does tho Planter Come In!

Wall Syea Daily Neps, May g.: Mys.
terious Iumors are sh at 10 Wall street
that the affairs OF the Southern Cotton
Oil Company (the cor Germ recently Or
gsniz d 40 a competitor Of the Ameri-
can Oil Trust) are not in very Toseate
condition. IL is said that some CT the
gentlemen whoss subscriptions were
obtained, have drawn ont. 1t is scarce
ly to be wondered at that such is the
case, fJr there seems to be but little
hope for the stockholders in such a
concern, when the American Cotton
Oil Trust, comprising 80 per cent. OF
the practical mill owners OF the South,
controls the raw material as well as
the manufactured product. An oppo.
sition to such corporation can only
prove futile.
But this ia not the only reason why
capitalists ara dieinclined to put up
funds freely for the new venture.
The gentlemen who organized the
Southern Cotton Oil Company have
not gone about 1t in way calculated
to inspire the confidence OF investors.
The sales CT stock at so cents on the
dollar are not ia themselves repre-
hensible. 1t is usually the custom to
lot first corners into a new enterprise
at concessions. They have TO be given
a soft thing to induce them to 20 in at
all. 1t Goes, however, seem kind of
odd for the officials to be provided
with lot OF patents to absorb the
first income from the subscriptions.
For instance, at one of the fret
meetings Of the original direc ors OF
the Southern Cotton Oil Company it
WAS resolved that the company should
then purchase twelve patents for diff.
faIent devices connected with the
manufacture OF cotton oil; and OF the
twelve, Six appear to be controlled by
the directors whose names appear at
the board meeting where the purchase
was authorized.
1t was a pretty idea also to arrange
that the treasurer's bond should be
for only $4,000, and that his two
hsothere, also in the concern, should
stand "a sureties.
1t was not a bad idea either, for
these same gentlemen, alter buying
enough of their own patents as COM
paDy, which they had previously beld
as individuals, to go ahead aud pro.
vide for the expenditure OF future in !,
come from the subscriptions OF out
siders by awarding themselves Sal 900
per annum in salaries divided Us fol-
lows:
Per AnmuW.
HrNntN0Ht
General ManAger......... IL, 900
Assistant Manager and Ent ineer-,... 10 900
Secretary and Treasurer. ..-..,"..".... 1000
Nor shortly sf,erward to make an.
other Cffice at $4,000 per annum.
But the neatest stroke OF diplomacy
we have ever seen was in the execu-
ton the agreement which the stock
holder Is required to sign, and which
leaves the shares which he is to get 90
completely the property of the trustees
as the money which he pays In for
them, for the term of one year. He
cannot SSH, except at price which
they name, and through them. The
trustees, however, can market
eubscribers' stock at their own
option. In other words, the stock
holders money and his shares are
alike at the disposal of the trustees.
The trustees of such a company
ought to prosper, whether the stock
holders do or not, provided they can
get enough lambs to pay in their
money, and sign such agreement.
The president Of the Southern Oil
Company is Henry G. Butcher, of
whom Phil Armour is reported to
have raid recently when offered 5000
shares of the stock by him on the
ground floor: II will build fence so
high that he cannot climb over, and 80
low that he cannot crawl under it."